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In this tutorial on starting freelancing, the speaker discusses the differences between contracts and proposals. They clarify that while contracts are legal documents outlining the terms of the deal, including obligations and legal terms, proposals serve as sales documents aimed at persuading clients to engage in the deal. Proposals explain what the project includes, its cost, and payment terms. Often, proposals can also contain terms that align with a contract, effectively serving dual purposes. The speaker emphasizes that their advice is from a freelancer's perspective, not legal advice.